Salaries of skilled workers rise faster than inflation, survey finds
ABU DHABI // Salaries of skilled workers and managers are keeping ahead of inflation thanks to competition among rival firms, according to a new survey. The basic salaries of managers are up 15 per cent this year compared to 2007, according to the survey by Hay Group, a global consulting firm. Base salaries accounted for 54 per cent of employees' average income.
Incomes for managers calculated as guaranteed cash, which included their basic salary plus cash allowances, were up about 11 per cent over last year. The survey, based on information from 376 employers throughout the UAE, also showed that companies were more willing to reward valued staff with bigger bonuses. Strong competition for a limited pool of highly-skilled workers is keeping pay increases for senior staff above the inflation rate, which hit 11.1 per cent last year, Hay said.
Vijay Gandhi, the general manager of Hay's Reward Information Services, added that pay for senior managers was increasing at "a much higher pace" than for supervisory and clerical jobs. "In addition to the increases in basic salary and allowances, the variable bonus has shown a considerable increase since last year." The "war for talent" was natural in a diversifying economy with a shortage of skilled workers, especially managers, Mr Gandhi said.
The survey said the average rise in managerial salaries was one of the highest in the region, and that the oil and gas sector was the leading payer in the market. George Saab, of Chalhoub Group, a retail conglomerate, agreed the pay increases were not surprising. "We are aware of the rising cost of living which is causing everyone to react." But he added: "We cannot continue like this. Other than pay, the formula for attracting and retaining talent is long-term incentives, better talent management practices, employee satisfaction and reducing pressure on employees."
CK Ravish, of Easa Saleh Al Gurg Group, said: "At this moment the key challenge in attracting and retaining people is money. We are finding that the lifestyle employees have maintained previously is no longer possible with incremental increases." While highlighting the importance of attractive salaries, Mark Williams, Hay's director of leadership and talent, said talented workers were not motivated solely by financial rewards. "When this war for talent has cooled, organisations need to be prepared for the next phase," he said. "It's about retaining as well as attracting the right people for the right jobs. Pay is obviously a very important factor. However, organisations that put all their eggs in the pay basket will only see a short-term benefit. The organisations that place an equal focus on engaging and developing their people will be the ones that ultimately win the war for talent."
Rental inflation The Abu Dhabi Council for Economic Development has called on developers to improve the supply of properties to help address rental inflation, the state news agency WAM reported last night. In a report entitled Real Estate in Abu Dhabi: between the present crisis and future developments, the council warned that increasing property prices continued to threaten the growth of the emirate.
"There is no indication that the persistent rise in prices in Abu Dhabi or other emirates is going to slow in the near future," it said. Only an increase in the supply of properties to meet demand could help. The market also needed detailed information about pricing and completion dates for planned projects to enable appropriate future planning, the report said. @Email:email@example.com
Published: August 31, 2008 04:00 AM